Whats a Virtual Power Plant (VPP)?

Posted on 14 October 2025

What’s a VPP?

A VPP, or Virtual Power Plant, is a network of home batteries connected to a central control system. Instead of operating completely independently, the batteries can act together to support the electricity grid when demand is high.

At first glance, that might sound like something you would not want your battery involved in. After all, you invested in a battery to reduce your own energy bills, not to help stabilise the grid.

Here is the twist. The right VPP can actually put money back in your pocket. By exporting energy at the moments the grid values it most, a VPP can turn energy bills into credits and significantly shorten the payback period on your battery.

That said, not all VPPs work the same way. Some offer flexibility and strong rewards, while others come with restrictions that are hard to escape. Broadly, VPPs fall into three categories.

1. Locked‑in VPP Contracts

This type of VPP usually offers a large sign up credit in exchange for a long contract, often five years or more. These are commonly bundled when a battery is sold directly through an energy retailer.

While the upfront incentive can look attractive, this option has some major downsides.

The energy market is evolving rapidly, and locking yourself into a long-term agreement can prevent you from taking advantage of better opportunities in the future. You have already invested heavily in your battery, so losing control over how it operates can be a real limitation.

Verdict: Not recommended.

2. Set and Forget VPPs

Example: Origin Loop

This is the low risk, low involvement option and one we often recommend for most households.

Typical benefits include:

• A $200 sign up bonus
• $1 per kWh paid for energy exported from your battery, on top of your standard feed in tariff
• A low annual export cap, usually around 200 kWh per year

In practical terms, this can deliver over $400 in credits in the first year while exporting a very small amount of energy from your battery. Even if exports happen on a night that is not ideal for your own usage, you are still paid extremely well for that energy.

There is no lock in, and you can leave the VPP at any time. For homeowners who do not want to actively manage their energy system, this really is a true set and forget solution.

Verdict: Highly recommended for simplicity and reliable returns.

3. Wholesale Energy VPPs

Example: Amber Electric SmartShift

This option is designed for people who want to actively maximise their returns and are comfortable with a more hands on approach.

Amber’s SmartShift is different to traditional VPPs. Rather than paying fixed incentives, it allows your battery to trade on the wholesale energy market. It aims to charge when prices are low or negative and export when prices spike, passing 100 percent of the wholesale outcomes through to you.

Key features include:

• Access to real time wholesale pricing
• The ability to export energy during price spikes that can reach extremely high levels
• A monthly fee of around $25
• Hardware compatibility requirements

During the day, wholesale prices are often negative. SmartShift reduces or stops feed in during those times to avoid paying to export energy. While this means you export fewer kilowatt hours overall, the energy you do export is typically rewarded at much higher prices.

This option can work exceptionally well for homes with:

• Larger batteries
• Smaller solar systems
• High daytime energy use such as pools, electric hot water, or heavy air conditioning

Robbie, our sales manager personally uses this model. Even with high daily energy use of around 25 kWh, Amber Electric and his battery system consistently deliver monthly credits and has dramatically accelerated his battery systems return on investment. He documented his results and data on this link ’18 Months with Amber Electric’.

Verdict: Recommended for users willing to monitor and optimise their system.

So, which VPP should you choose?

Locked in contracts offer a tempting upfront bonus but are too restrictive long term and are best avoided.

Set and forget VPPs suit most households and offer strong, predictable rewards without commitment.

Wholesale energy VPPs deliver the highest potential returns for users prepared to actively manage their system or who have suitable usage patterns.

Bonus: REPS Battery Rebate

Joining an approved VPP also makes you eligible for the South Australian REPS battery rebate, which can be worth up to $2,050 depending on battery size.

The key advantage with flexible VPPs like Origin and Amber is that you can leave at any time. This means you can claim the rebate, try the VPP, and reassess later without being locked in.

For example, you could join Origin Loop, receive the $200 sign up bonus, claim the rebate, and test the VPP risk free. Even if you decide to leave, you keep both the rebate and the sign up credit.

Interested?

If a VPP sounds like something you would like to explore, get in touch. We can:

• Check your battery and inverter compatibility
• Help fast track your VPP setup
• Assist with REPS rebate applications
• Provide support if issues arise
• Make sure your battery is working as hard as possible for you.